State Economic Development Expenditures: FY2015 Update
The Council for Community and Economic Research (C2ER) recently updated its State Economic Development Program Expenditures Database as part of a continuous effort to track investments in economic development across all fifty states. The database now includes all Governor Recommended Budgets for fiscal year 2015.
Based on this data, states are collectively proposing to spend $7.95 billion for economic development related activities in FY2015, which represents a small increase over the FY2014 enacted budgets total for economic development. However, the FY2015 recommended budgets total represents a sizable 9.6 percent increase over the FY2013 actual economic development expenditures total of $7.26 billion.
A closer look at spending trends broken down by economic development functional areas reveals that states are increasing their investments in workforce preparation and development, strategic business attraction funding, international trade and investment, and entrepreneurial development. Compared to FY2014, states are proposing to increase workforce preparation and development by $81 million, strategic business attraction funding by $82 million, international trade and investment by $7 million, and entrepreneurial development by $16 million. Proposed budget cuts in FY2015 are mainly to community assistance programs ($184 million decrease from FY2014), special industry assistance ($11 million decrease from FY2014), and business finance ($5 million decrease from FY2014).
Based on the FY2015 expenditures data, a few notable trends emerged across all the states:
- Workforce development has become increasingly important, although overall expenditures for workforce development remain lower than the pre-Recession levels. There were notable increases in workforce development proposed expenditures in Delaware, Florida, and Louisiana.
- States have been increasing their investments in early-stage tech firms through seed/venture capital programs. Examples of new and increased spending include the Advanced Industries Accelerator Program in Colorado and Hawaii’s Strategic Development Corporation.
- Community assistance is still heavily funded but has become less important compared to before the Recession.
- States like Louisiana, Delaware and Florida have been increasing funding and creating new programs and offices for international trade and investment.
C2ER members can access the database through the C2ER member area. For more information about the database, please contact Sarah Gutschow or Wen Sun.